Natural gas consolidates ahead of storage report

Daily Market Analysis for Thursday, 08/01/2013

KEY TERMS

OVB      Outside Vertical Bar

VRCB   Volatility Reduced Compression Bar

ENERGIES

Brent Crude Oil (September ‘13):

  • Short Term Trend is bullish.
  • Confirmation of a top with a range violation on 07/24/2013 @ 107.00. Confirmation of a bottom with a close violation on 06/27/2013 @ 102.82. Upside Targets = 111.27 – 112.65.
  • Bullish OVB generated on Wednesday after making new lows on the week @ 105.73.
    • September Brent Crude rebounded from its steep overnight loss on Wednesday to reverse course and explode higher off the lows of the past three weeks to come back and log new highs for the week.
    • With daily Bollinger Bands at their most narrow levels of the year, current price action suggests that the market should break through the July highs and the $110 psychological barrier over the coming week with an expansion of ST volatility.
  • Projected Daily Range: 1.51
  • Projected Weekly Range: 4.31
  • Projected Monthly Range: 9.49

WTI Crude Oil (September ‘13): (NYMEX:CLU13)

  • Short Term Trend is bullish.
  • Confirmation of a top with a range violation on 07/23/2013 @ 106.47. Confirmation of a top with a close violation on 07/24/2013 @ 105.39. Downside Targets =  103.61 – 102.75
  • Close > High of the Low Day generated on Wednesday. Possible confirmation of a bottom with a range violation @ 105.44. Possible confirmation of a bottom with a close violation @ 105.44 or higher.
    • September WTI Crude Oil rocketed higher on Wednesday after no change in the Fed funds rate or guidance was issued following a weak GDP report.
    • WTI should see an extension of these gain on Thursday back above $106 while confirming a ST bottom as it heads for the week-ending upside objective of $107.44.
  • Projected Daily Range: 1.96
  • Projected Weekly Range: 4.77
  • Projected Monthly Range: 9.13

Natural Gas (September ‘13): (NYMEX:NGU13)

  • Short Term Trend is bearish.
  • Confirmation of a top with a range violation on 07/26/2013 @ 3.611. Confirmation of a top with a close violation on 07/26/2013 @ 3.563. Downside Targets = 3.433 – 3.383
  • Inside VRCB generated on Wednesday.
    • September Natural Gas traded within its most narrow daily range since early June on Wednesday ahead of the EIA storage report as the market continues to digest the recent sell-off while closing below the daily support Bollinger Band for the third straight day.
    • With July closing just off the lows of the month, August now has a very strong probability of extending the downward pressure to new lows, which should ultimately bring $3.217 pricing into play.
  • Projected Daily Range: .145
  • Projected Weekly Range: .242
  • Projected Monthly Range: .548
About the Author
Kris Hicks

KMH is a trading and technical analysis firm that specializes in commodity futures and commodity based ETF’s. Kris Hicks has worked for numerous years in the commodity business and in 2011 accurately forecasted both $25 moves to the downside in May and July and the $25+ move to the upside in October in oil. He also called the all-time high day for gold on Sept. 6, 2011 and forecasted a projected downside target of 1528.10 in March 2012. He was also responsible for projecting the Q2 and Q4 low in the Euro FX to within 13 and 9 ticks, respectively. His trading methodology has a high degree of accuracy which confirms tops/bottoms, projected trading ranges and projected targets for those ranges. His expertise is focused on 16 commodities plus the comparable ETF markets. You can reach Kris at Kris@KMH-Capital.com or visit his website at www.KMH-Capital.com.

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